The Competition Commission, a key statutory body mandated to investigate and evaluate restrictive business practices and abuse of dominant positions, recently launched a probe into Centrum Pharmacy and found, among others, that the pharmacy’s average mark-up for facial masks in March 2020 was above 100%, which is significantly above its average mark-up on “non-essential” products that it has maintained over time.
Centrum Pharmacy did not sell facial masks before March 2020. It sourced masks from various suppliers due to the sudden demand and panic-buying brought on by the national state of national, the commission said. It found that Centrum Pharmacy’s mask prices were in contravention of the Competition Act (excessive pricing) and the Consumer Protection Regulations.
As part of the penalty approved by the Competition Tribunal, which adjudicates competition matters, the pharmacy must donate hand sanitisers, surgical gloves and face masks to the value of about R25,000 to two retirement homes in its area of business.
In terms of the agreement, Centrum Pharmacy must stop its excessive pricing and reduce the price of its face masks to significantly below that which it conventionally levies on other non-pharmaceutical store items with immediate effect for the duration of the state of national disaster.
phakathib@businesslive.co.za
Pharmacy penalised for profiteering during lockdown
A Gauteng-based pharmacy has been penalised by competition authorities for charging excessive prices for facial masks, making it the first retailer to be sanctioned for such a transgression during the lockdown.
The competition authorities have received a record number of complaints against retailers and suppliers for charging excessive prices for essentials after the outbreak of the coronavirus pandemic and the subsequent decision by the government to place SA on lockdown.
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The Competition Commission, a key statutory body mandated to investigate and evaluate restrictive business practices and abuse of dominant positions, recently launched a probe into Centrum Pharmacy and found, among others, that the pharmacy’s average mark-up for facial masks in March 2020 was above 100%, which is significantly above its average mark-up on “non-essential” products that it has maintained over time.
Centrum Pharmacy did not sell facial masks before March 2020. It sourced masks from various suppliers due to the sudden demand and panic-buying brought on by the national state of national, the commission said. It found that Centrum Pharmacy’s mask prices were in contravention of the Competition Act (excessive pricing) and the Consumer Protection Regulations.
As part of the penalty approved by the Competition Tribunal, which adjudicates competition matters, the pharmacy must donate hand sanitisers, surgical gloves and face masks to the value of about R25,000 to two retirement homes in its area of business.
In terms of the agreement, Centrum Pharmacy must stop its excessive pricing and reduce the price of its face masks to significantly below that which it conventionally levies on other non-pharmaceutical store items with immediate effect for the duration of the state of national disaster.
phakathib@businesslive.co.za
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